Kenanga Cuts Bina Puri Target To MYR1.24; Keeps Buy

 Kenanga Research cuts Bina Puri's (5932.KU) target price to MYR1.24 from MYR1.50 after revising down its FY11-FY12 earnings forecasts by 52% and 8% respectively, citing delays in the LRT project and a higher tax charge in FY11. 

The house notes that Bina Puri's 9M11 results were below expectations and made up only 45% of the house's FY11 forecast. "

We believe the group has taken another hit on its construction revenue for the LRT project, which were delayed again while we are seeing a positive progression on KLIA2. 

We however expect the earnings to be normalized in upcoming quarters as more revenues are recognised from both the projects," it says.

 The house believes there will be more potential order book replenishments in FY12 and says the group may also launch its own development projects in Klang Valley, Johor Bahru and Kota Kinabalu next year. It keeps a Buy rating on the stock. Shares are flat at MYR0.885.